China's property sector debt turmoil is set to keep a lid on Asian high-yield corporate bond deals in the first half of next year after a string of defaults by real estate firms left global investors licking their wounds, bankers said.
The failure to make payments, followed by a string of credit rating downgrades of, has roiled China's high-yield debt, sparked outflows and made asset managers jittery about issuers in the region.
"It's a reasonably short list of names that could reopen the high-yield market," said Ernst Grabowski, head of Asia Pacific debt syndicate at Morgan Stanley"It would have to be a company where most investors feel that it's relatively safe as a credit proposition and where they assess there is enough support from other investors and where they deem liquidity is going to be decent.
The first deal to break the high-yield freeze would need to be from a stronger company to give investor the confidence that new issuance can be carried out to open up the market to other issuers, advisors said.
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